$ALAB

Summary

The analyst is holding core AI infrastructure longs like NVDA, AVGO, TSM, and optical names LITE and COHR, while trimming more crowded/high multiple names like CRDO and ALAB. They advise generally avoiding short-term trades into macro events.

Reasoning

AI trades and positioning: holding core AI infra longs; trimmed crowded/high multiple/post rebound names; hawkish FOMC could hurt long-duration semis like NVDA and AMD; memory stocks more earnings-driven and insulated.

Paradis Macro Report [June 16]: Catalysts · FOMC · US/Iran Peace Deal · AI Trades & Positioning -> Today is day one of a brutal catalyst cluster: - Tomorrow: Warsh's first FOMC - Tomorrow: UK May CPI + US May retail sales - Thursday: BoE - Friday: US/Iran signing ceremony (US markets shut) - June 22: Index rebalance - $MRVL joining S&P 500. $ALAB, $CRWV, $NBIS, $RKLB, $TER joining Nasdaq. - June 24: $MU earnings -> FOMC tomorrow is most important: It'll be a near-certain hold decision, and the markets have fully priced in cuts to hikes in 2026. With CNBC reporting 66% chance of at least 0.25 pt hike by end of 2026. Already priced (neutral): A hold, removal of the easing bias, a 2026 median dot showing zero cuts, one hike by year end, "inflation elevated" language. Hawkish surprise: A two hike 2026 median dot, explicit signal of a September/October hike, Warsh framing the energy shock as structural, scrapping the dot plot in a way that lifts term premium. Dovish surprise: Warsh leaning on AI-productivity to argue inflation is nearly tamed, framing oil as transitory, a 2026 median that still shows zero hikes. Hawkish dot/guidance -> bad for long-duration AI-semis. "Transitory energy" framing -> risk-on. -> US/Iran Peace Deal The US/Iran peace deal is what's led to a more risk-on market this week. Where on Sunday, Trump posted that the deal "is now complete," authorizing "the toll free opening of the Strait of Hormuz." Things are still unfolding, with the formal signing due on Friday, with the US and Iran both describing different deals: - US: expecting permanently toll-free transit and full nuclear dismantlement - Iran: saying transits are toll-free for 60 days then administered by Iran + Oman w/ "no new nuclear commitments" Also important to note that the Strait of Hormuz is still effectively closed. But both Brent + WTI dropped to two-month lows. And 10Y yields fell to ~4.43% intraday (one month low). Leading to all the equity indices rising this week. Ofc partly driven by $SPCX going ape shit. Regardless, Hormuz reopening would: - Remove the inflation tail (energy was the bulk of May's CPI gain) - Relieve Fed hike pressure - Broadly risk-on for higher beta AI stocks Also, US markets are closed on Friday so headline gap risk is elevated. -> AI Trades & Positioning: Would not cut core AI infra longs right now. Personally, I trimmed some of the more crowded/high multiple/post rebound names like $CRDO / $ALAB etc. And holding core names like $NVDA / $AVGO / $TSM plus optical names like $LITE / $COHR. I've also got some FX hedges on e.g. USD/JPY which are relatively cheap rn. Then for positioning into FOMC: Hawkish playbook: long-duration semis like $NVDA + $AMD are most rate-sensitive and lead down on a hawkish dot / 10Y >4.7%. Memory ($SNDK / $MU) is more earnings-driven and somewhat insulated. However, for most people, I would generally avoid placing short-term trades into macro events. Especially riskier instruments like options/leverage. --- I could honestly turn this into a 5,000 word report lol, but that's the *very* high level summary.

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